Installment Loans pp SECTION

Click to edit Master text styles Second level Third level Fourth level Fifth level 2 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 2 of Section Objective Calculate: amount financed on an installment loan

Click to edit Master text styles Second level Third level Fourth level Fifth level 3 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 3 of installment loan (p. 287) A loan repaid in several equal payments over a specified period of time. down payment (p. 287) A portion of the cash price of an item that has to be paid before financing the rest on credit. Key Words to Know

Click to edit Master text styles Second level Third level Fourth level Fifth level 4 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 4 of amount financed (p. 287) The portion of the cash price that is owed on an item after making the down payment. Key Words to Know

Click to edit Master text styles Second level Third level Fourth level Fifth level 5 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 5 of Amount Financed = Cash Price – Down Payment Formula 1

Click to edit Master text styles Second level Third level Fourth level Fifth level 6 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 6 of Down Payment = Amount × Percent Formula 2

Click to edit Master text styles Second level Third level Fourth level Fifth level 7 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 7 of Before the bank will give him a loan, what does Chen have to do first? A Picture Perfect Loan p. 287

Click to edit Master text styles Second level Third level Fourth level Fifth level 8 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 8 of Tasheka Quintero is buying a new refrigerator for $1,399. Quintero made a down payment of $199 and financed the remainder. How much did Quintero finance? Example 1

Click to edit Master text styles Second level Third level Fourth level Fifth level 9 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 9 of Step: Find the amount financed. Cash Price – Down Payment $1,399 – $199 = $1,200 Example 1 Answer

Click to edit Master text styles Second level Third level Fourth level Fifth level 10 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 10 of Rebecca Clay purchased a washer and a dryer for $1,140. She used the store’s installment credit plan to pay for the items. She made a down payment and financed the remaining amount. What amount did she finance if she made a 20 percent down payment? Example 2

Click to edit Master text styles Second level Third level Fourth level Fifth level 11 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 11 of Find the 20 percent down payment. $1,140 × 20% = $228 Example 2 Answer: Step 1

Click to edit Master text styles Second level Third level Fourth level Fifth level 12 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 12 of Find the amount financed. Cash Price – Down Payment $1,140 – $228 = $912 Example 2 Answer: Step 2

Click to edit Master text styles Second level Third level Fourth level Fifth level 13 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 13 of Matt Yokohama purchased a fountain for his newly landscaped backyard. The fountain cost $677. He made a down payment of 15 percent. What amount did he finance? Practice 1

Click to edit Master text styles Second level Third level Fourth level Fifth level 14 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 14 of $ Practice 1 Answer

Click to edit Master text styles Second level Third level Fourth level Fifth level 15 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 15 of Janelle Lewis purchased a new dishwasher for $425. She made a 20 percent down payment and financed the remaining amount. Find the down payment and the amount financed. Practice 2

Click to edit Master text styles Second level Third level Fourth level Fifth level 16 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 8-2, Slide 16 of Down payment: $85 Amount financed: $340 Practice 2 Answer

Installment Loans 8-2 END OF SECTION